Israel ready to cede land for peace

TEL AVIV - Prime Minister Ariel Sharon says Israel will have to give up some occupied land for peace with Palestinians, but vows to speed up work on a disputed West Bank barrier it deems vital to its security.

He also raised the possibility, in a question-and-answer session with Israeli editors, that he would take unspecified "unilateral steps" should talks with the Palestinians on advancing a peace roadmap fail.

Sharon's comments hardened hints floated in local media that he was prepared in the event of continued stalemate in the peace process to remove some isolated Jewish settlements and draw the boundaries of a Palestinian state along the route of the barrier, which cuts deep into the West Bank.

"It is clear that in the end we will not be in all the places where we are now," the right-wing premier said. "[But] we are accelerating the fence and we won't stop it because it is essential to the security of the state."

Washington said this week it was penalising Israel for the barrier and settlement expansion by deducting nearly US$290 million ($452 million) from a multi-billion-dollar package of loan guarantees.

Opposition doves who have drafted an alternative, more far-reaching peace plan have dismissed Sharon's signs of flexibility as insincere, accusing him of a gambit to draw international attention away from their initiative.

- REUTERS